MBA FPX 5006 Assessment 2 Business Strategy

Business managers employ various strategic models, such as VRIO analysis, PESTEL analysis, and SWOT, to comprehend internal and external factors, enabling them to devise effective strategies for gaining a competitive edge. In the case of Vengile Software Company in the United States, the President of Strategy has tasked our team with analyzing the business strategy and conducting a comprehensive business analysis. As a strategic business consultant and enabler, I play a crucial part in helping the company select the optimal course of action.

Generic Business Analysis for the Company

Various companies employ diverse market approaches, and software firms in the UK and the US hire various strategic methods. One highly effective approach utilized for gaining a competitive edge is Porter’s Generic Strategies. An illustration of this is the Vengile Software Company in the United States, which employs a model comprising four key components: cost leadership, differentiation leadership, cost focus, and differentiation focus. The company uses this model to optimize cost management while maintaining a competitive position (Larbi, 2019).

Furthermore, the “Focus” component centers on the organization’s specialization in niche markets within specific geographical areas, allowing the company to excel in delivering software products tailored to growing industries. Lastly, the differentiation focus strategy represents an evolution of the Differentiation Strategy. It involves a dual focus on product differentiation and a strategic entry into niche markets.

Analysis of the Business Model of the Company

Vengile Software Company’s business model closely mirrors that of Microsoft Corporation, with a shared objective of enhancing competitive advantage and future growth strategies (Larbi, 2019). This alignment is pivotal for optimizing the firm’s performance and ensuring its competitiveness. The company’s competitive strategy revolves around enhancing the effectiveness of its computer software products in a highly competitive market, catering to a diverse clientele, including individuals, households, hotels, and businesses.

The company establishes a competitive edge through its broad differentiation strategy, attracting a global customer base. The company places significant importance on its software products’ tangible and intangible attributes to maintain its competitive advantage, such as developing unique software systems (Vinayachandra & K., 2019). In terms of market penetration, the company follows a growth-intensive model, expanding its presence in international markets, particularly in Asian countries, while emphasizing product development, akin to Microsoft’s approach. The relationship between the company’s business model and Porter’s Strategies is vital for managerial understanding. It assists in comprehending how the business operates and where it fits in the competitive landscape (Lotysh Oksana, 2022). The business model elucidates the company’s operations, while the business strategy defines its purpose and existence.

Analysis of the Corporate Strategy

Vengile’s corporate strategy centers on empowering its workforce and individuals through innovative digital technologies, revolutionizing how people work and communicate (Karanina et al., 2023). They aim to leverage their resources, such as distribution channels and marketing expertise, to connect businesses and individuals while enhancing their understanding of user-friendly software to boost productivity. Additionally, the company integrates Microsoft products like cloud systems and Windows Virtual Desktop, alongside Google Chrome and Microsoft Edge, in their marketing efforts, resulting in significant revenue growth in recent years.

MBA FPX 5006 Assessment 2 Business Strategy

Furthermore, Vengile proactively advances assets and new products for global businesses, facilitating professional growth and resource optimization (Zimuto & Zvarimwa, 2022). Their corporate strategy hinges on harnessing LinkedIn’s resources and professional networks to achieve meaningful scalability and engage in product innovation:

LinkedIn resources + data + Product Innovation = Profits

Vengile effectively utilizes LinkedIn and other social media platforms to introduce new products, features, and services. They have also launched a comprehensive website, further solidifying their position in the corporate landscape, including collaborations with industry giants like Microsoft. Vengile’s overarching mission is to cater to tech-savvy experts and novices, enabling them to harness the company’s products for professional and business success in our rapidly evolving technological world. This strategic focus is paramount for Vengile in its ongoing competition within the market. Regarding vertical scope, Vengile Soft aims to enhance its reach by acquiring various stages of software production, emphasizing efficient product delivery to clients through upstream and downstream processes (Krasavina et al., 2023). This strategic move reflects their commitment to ensuring swift and effective distribution.

Analysis of the Overall Corporate Structure

Vengile Soft employs an organizational structure combining divisional and product-oriented frameworks, housing multiple operational and functional groups, including engineering and information technology (IT) teams. Since 2016, the company has experienced consistent growth, expanding its workforce to nearly 200 employees, and has undertaken ongoing restructuring efforts to enhance its organizational setup.

In June 2017, significant changes occurred when the CEO unveiled a mission to align the company’s trajectory with its strategic vision for the next decade. The CEO aspired to shape Vengile into a software powerhouse akin to Microsoft. In line with Microsoft’s hierarchical model, Vengile adopted a hierarchical structure featuring multiple hierarchy levels and distinct functional divisions to streamline operations.

As the company matured over the past seven years, it embraced a hybrid organizational model. This approach effectively positions senior managers, various functional business groups, and IT engineering teams to optimize performance. The company’s current business groups encompass:

Business development team
Corporate strategy team
External and legal affairs team
Planning and corporate strategy department
Finance department
International marketing and sales group
Human resources (HR) group
Social media marketing group
Search engine optimization and content development
Worldwide commercial business

Additionally, Vengile incorporates specialized engineering groups to excel in serving its clients, including:

Artificial intelligence and cloud computing
Devices and experiences group
Research and development of software
United States and international divisions

Since 2016, the CEO has also assumed leadership roles in the organization’s structural, engineering, and marketing facets. This multifaceted leadership has enabled the company to innovate and build a strong reputation in the market. Vengile distinguishes between its two primary engineering and business groups, shaping their development to sustain a competitive advantage.

While Vengile may not currently compete with Microsoft on a geographical and competitive scale, it excels in product diversification. It aims to forge partnerships with Microsoft in the next five years. This goal has led to the adopting of a vertical strategic alliance as a corporate policy, integrating additional supply chain functions into its in-house products. This strategy seeks to establish cross-industry partnerships and strengthen existing technological alliances in the global marketplace, ultimately striving for mutual benefits and a competitive advantage.

Evaluation of the Strategic Fit between Business and Corporate Strategies

In the realm of software companies and businesses, the pursuit of strategies is imperative to achieve their objectives. In striving for tremendous success and enhanced competitiveness in the market, these entities often rely on two prevalent strategies: the business strategy and the corporate strategy. These strategies exhibit commonalities and distinctions, yet they can collaboratively serve Vengile Soft’s quest for enhanced performance and profitability (Chow et al., 2023).

The business strategy, for instance, is dedicated to orchestrating efforts to attract a broader customer base from global markets, thereby gaining a distinct selling advantage. This strategy is intricately linked to generating profits by providing high-quality products, ultimately bolstering the company’s competitiveness within its market. The specific objectives of the business strategy encompass:

Attracting and acquiring new customers.
Elevating customer satisfaction.
Enhancing overall profitability.

On the other hand, the corporate strategy within the organization takes a different trajectory by assisting managers in clarifying their mission, defining business goals, and plotting the course to attain them. It also encompasses formulating a learning strategy and discerning how and where learning initiatives can profoundly impact the organization’s workforce. The learning strategy plays a pivotal role in the corporate strategy, enabling managers to steer the organization toward the future achievement of business goals (Chow et al., 2023).

In this context, the corporate strategy empowers the organization to make optimal product choices and extend them to a global customer base, signifying the direct support provided by key business executives to their workforce.

References

Chow, D., Hardi Suandri, Herman, H., Prissilia Angelika, & Ricky, R. (2023). Meningkatkan Keunggulan Kompetitif dengan Memilih Strategi Tingkat Bisnis yang Tepat. Public Service and Governance Journal, 4(1), 116–123.

https://doi.org/10.56444/psgj.v4i1.816

Karanina, E., Ilysheva, N. N., & Bulgakova, K. V. (2023). Features of the human capital management strategy during the transition to new digital technologies at a large industrial enterprise. Èkonomika I Upravlenie: Problemy, Rešeniâ, 1/3(133), 25–32.

https://doi.org/10.36871/ek.up.p.r.2023.01.03.003

Krasavina, V., Platonovskiy, N., & Ibiev, G. (2023). Аgile as a wave of digital transformation. E3S Web of Conferences, 389, 07018.

https://doi.org/10.1051/e3sconf/202338907018

Larbi, G. M. (2019). A Try to combine more than approaches and competitive strategies to achieve a sustainable competitive advantage. Journal of Economics and Administrative Sciences, 25(116), 147–163.

https://doi.org/10.33095/jeas.v25i116.1792

Lotysh Oksana. (2022). The business model as a prerequisite for the development of the companys strategy in the market. Galicʹkij Ekonomìčnij Vìsnik, 78-79(5-6), 7–15.

https://doi.org/10.33108/galicianvisnyk_tntu2022.05_06.007

Vinayachandra, & K., K. P. (2019). Executing product broadening procedures for the sustainability of an innovation organization – A contextual analysis of Microsoft corporation. International Journal of Case Studies in Business, IT, and Education, 28–40.

https://doi.org/10.47992/ijcsbe.2581.6942.0049

Zimuto, J., & Zvarimwa, C. (2022). Valuable, rare, inimitable, non-substitutable and exploitable (VRINE) resources on competitive advantage. EPH – International Journal of Business & Management Science, 8(1), 9–21.

https://doi.org/10.53555/ephbms.v8i1.1915

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MBA FPX 5006 Assessment 1 Strategic Process and Analysis